Already a member?

Denny's Obtains New Credit - Analyst Blog

Denny's Corporation
(
DENN
) recently announced that it has received a $250 million senior
bank credit facility, which includes a $60 million revolving credit
and $190 million term loan. The new facility refinances Denny's
senior secured debt from September 2010 and amended in March 2011
that had a term loan of $250 million and a $60 million
revolver.

The new credit facility will mature in 5 years and is at an
interest rate lower than the prior credit. The refinancing is
expected to save annualized interest expense of around $5 million,
based on current interest rates.

Besides paying down the company's high-cost debt, the new credit
facility will increase available fund and extend the maturity
period of debt. The company believes that the new credit facility
will strengthen its financial position.

The long-term debt, less current maturities of America's largest
full-service family restaurant chain as of December 28, 2011 was
$193.3 million, down from $234.1 million at December 29, 2010.
The term loan will be paid off 10% per year on a quarterly
basis with the outstanding balance payable upon maturity.
Additionally, the company is open to an option to further reduce
interest rates.

Denny's expects to incur a one-time charge of approximately $8
million in the second quarter of 2012 due to its new bank facility.
The charges will be shown as other non-operating expense and
include the unamortized portion of deferred financing costs,
original issue discount related to the prior facility, and the fees
associated with the new facility.

Please note that once you make your selection, it will apply to all future visits to NASDAQ.com.
If, at any time, you are interested in reverting to our default settings, please select Default Setting above.

If you have any questions or encounter any issues in changing your default settings, please email isfeedback@nasdaq.com.

Please confirm your selection:

You have selected to change your default setting for the Quote Search. This will now be your default target page;
unless you change your configuration again, or you delete your
cookies. Are you sure you want to change your settings?